Davis Division uses two raw materials-X33 and Z42-to produce its product called Base 23, a chemical base

Question:

Davis Division uses two raw materials-X33 and Z42-to produce its product called Base 23, a chemical base for interior house paint. The materials are mixed in the following standard proportions to yield 100 liters of Base 23

Quantity (litres) Material Cost per Litre $1 $5 X33 80 Z42 20


It requires 5 hours of direct labour at SIS per hour to produce 100 litres of Base 23.

On average, the division can produce and sell 20,000 litres of Base 23 per month. In a recent month, the division used the following amounts of materials and labour to produce 18,000 litres of Base 23:Material Quantity (litres) Total Actual Cost X33 16,200 $16,200 Z42 5,400 21,600 27,500 $43,700 Direct labour. 1,050 hou


Required:

1.  Calculate the following materials variances for Base 23:

a.  Price.

b.  Quantity.

c.  Mix.

d.  Yield.

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Related Book For  book-img-for-question

Managerial Accounting

ISBN: 9781259275814

11th Canadian Edition

Authors: Ray H Garrison, Alan Webb, Theresa Libby

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